mktg 335 quiz 1 (sales) ch 1-4

Sales

Exchange of a product or service to a buyer

Responsibilities of a salesperson

Understand inquiries - markets and products / find potential customers / learn customer problems and needs / determine solutions / communicate benefits / monitor order and shipping / ensure customer satisfaction

Nothing happens in an organization until...

A sale is made

Benefits of a sales career

Attention and identity / instant gratification / powerful network and future security / flexible schedule and freedom / pay for performance / exposure to senior management / transferable skills / customer entertainment

Skills and traits that lead to sales success

Listening / follow-up / adapting sales style to the situation / tenacity (sticking with a task) / GRIT

GRIT

Passion and perseverance for long term goals (Angela Duckworth) - IQ does not predict success - sales is a marathon not a sprint - you work through problems and do not quit

Top skill for sales success

Active listening

Traditional salesperson

Guided by self-interest (Wolf of Wall Street - motivated by money)

Professional salesperson

Polite and persistent (Pursuit of Happiness - a grinder who follows up and does the right thing)

Golden rule salesperson

Puts others' interests first to build long term relationships (treat others how they want to be treated)

SEF survey - what influences purchases most

1. Competence of salesperson 37% / 2. Quality of product or service 25% / 3. Total custom solution 21% / 4. Competitive price 17%

Competence of the salesperson (SEF)

37% - stable - the largest purchase influencer

Quality of product or service (SEF)

25% - stable

Total customer solution (SEF)

21% - trending up

Competitive price (SEF)

17% - trending down - customers do not buy on price alone

Price elasticity

Works for consumer selling but not for B2B

Direct sales

Out in the field (outside sales)

Indirect sales

Not in the field - inside sales on the phone

Strategic account management

Dedicated to big corporate accounts (Amazon and Boeing) - retain and upsell existing customers

New business development (hunter)

Finds new customers and lands the deals

Account management (farmer)

Maintains relationships and maximizes sales from existing accounts

Product or service specialist

Technical or engineering type who talks about specifics and technical needs

Buying role

Purchasing manager or purchaser - only the start of the buying group

Direct procurement

Products and services used to create the product or service provided to end users

Indirect procurement

Products or services used in company operations (facilities - HR - overhead)

Buying center / buying group members

User / buyer (economic buyer) / influencer / gatekeeper / decision-maker / C-suite

Why the user matters in the buying group

Needs identification - understand the user and not just the purchaser - you are selling to a team

C-suite

CEO - CFO - CMO - COO - CSO

Gatekeeper

Controls access to decision-makers and information

Buyer motivations (situations)

Moving a buyer from a current state (a problem) to a desired state - situation repair or improvement

Why implementing a new supplier is hard

It is a pain for buyers - they resist change

Role of emotions in buying

Emotions can skew logical thinking - EQ helps you read the buyer type and tell rational from erratic decisions

FAB

Features - advantages - benefits

Feature

A physical or technical attribute of the product

Benefit

The value of a feature that the buyer perceives or experiences - KEY to selling

Value

We turn FABs into dollars (monetization)

Three favorite words in selling

"Which means that" - the bridge from a feature to a benefit

Two favorite words in selling

Trial close

Comparison selling

Compares price to benefits

Product FABs

Physical features of the product itself

Non-product FABs

Benefits beyond the product - delivery - inventory terms - co-op advertising - display - training - warranty - on-site labor - 24/7/365 service

JIT (just in time)

Delivery strategy that brings goods in only as needed for production or immediate use

Consignment arrangement

Customer pays only when the product sells (Dell example) - great cash flow

Inventory buy-back guarantee

Seller agrees to take back leftover inventory - lowers buyer risk

Co-op advertising

Seller and retailer share advertising costs

Inventory carrying costs

Cost to the buyer of holding inventory

Customer service 24/7/365

Very important but very expensive - choose what fits the customer's needs

Product commoditization

Buyer perception of little to no meaningful differentiation among options - decision comes down to price

How to fight commoditization

Non-product features and benefits - bundles - better warranty (Nalgene vs Hydroflask) - seller trust and responsiveness

Factors that influence the buying decision

Product complexity - process complexity - decision level - risk - commoditization

Product complexity

Buyers may need an engineer to walk them through the process

Process complexity

Buying center and buying teams - if it is complex to install you have problems

Decision levels in an organization

C-suite - middle managers - users and front-line employees

New task buy

A change from the status quo

Modified rebuy

Similar purchase with the same function but with changes

Straight rebuy

Replacement of the same product

Opportunity risk

Wrong choice when an alternative existed - cost of not buying something else (invite competition and be transparent)

Time risk

How long it takes to implement or learn the product - or to make the decision

Financial risk

Could I have bought it cheaper - costs exceed returns

Social or psychological risk

Ethics - morals - reputation - embarrassment

Functional risk

The product does not work

Physical risk

Someone could be physically hurt

Kickback

Illegal or unethical payment or favor given in exchange for favorable treatment or contracts

IMPACT

Six reasons customers buy: Image - Money - Productivity - Advantage - Customer satisfaction - Total cost of ownership

I in IMPACT

Image - reputation - brand (Ferrari - eco-friendly tech - premium brand signals quality)

M in IMPACT

Money - cost reduction - new revenue through automation

P in IMPACT

Productivity - efficiency (software that reduces task time)

A in IMPACT

Advantage - something competitors lack (Tesla EV - faster to market)

C in IMPACT

Customer satisfaction - CRM improving communication - fewer complaint calls

T in IMPACT

Total cost of ownership - lower long term cost (Tesla - no gas - less maintenance)

If-then close

Never give a discount for nothing - if you commit for 3 years then we give you 10% off - builds credibility

Razor blade marketing

Sell a durable base product cheaply to lock customers into buying high-margin recurring items (PACCAR parts)

Selling vs marketing

Selling is intimacy and relationships - marketing is awareness

7 areas of professionalism

Integrity - competency - humility - accountability - self-regulation - professional image - emotional intelligence

Integrity

Fairness - doing the right thing in the right way even when it inconveniences you - not about you but about the customer

Competency

Necessary knowledge and preparation - do your advance homework

What to say when you do not know an answer

"I don't know the answer to that but I will get back to you ASAP" - shows integrity and competency

Humility

Modesty - making the sales process about the customer and not the salesperson

Accountability

Taking responsibility for success or failure - do not throw anyone under the bus

Self-regulation

Maintaining control of emotions and actions - take the high road when criticized

Professional image

Appearance and dress - dress one step above the customer - follow the company dress code

Emotional intelligence (EQ)

Understanding and awareness of your own and others' emotions to manage behavior and relationships

EQ vs IQ

EQ is twice as important as technical skills or IQ for high performance

Personal competence (EQ)

Self-awareness - self-management - motivation

Social competence (EQ)

Social awareness - relationship management

Why EQ matters to customers

Customers want rational and predictable salespeople - lack of awareness scares them

Objective of communication

Understanding - not just conveying information

Verbal communication skills

Vocal qualities - tone - inflection - articulation - avoid filler words - power of the pause - avoid up speak

Words to avoid

Probably - maybe - approximately - sort of (they make customers doubtful)

Say "investment" instead of

Cost

Say "share" instead of

Show

Say "inexpensive" instead of

Cheap

Say "value" instead of

Low-cost

Say "challenge" or "obstacle" instead of

Problem

Say "concerns" instead of

Objections

Say "definitely" instead of

Probably or about

Say "we" instead of

I

Say "more attractive" instead of

Better

Adaptive selling

A need-satisfaction format that adjusts the presentation to the selling situation - knowing when to offer solutions and when to ask for more information

Nonverbal communication

The unspoken transfer of messages through cues - body language - facial expressions - eye contact - handshake - appearance - space